Clean Energy Fuels Corp. (NASDAQ: CLNE) (“Clean Energy” or the
“Company”) today announced its operating results for the second
quarter of 2019.
Andrew J. Littlefair, Clean Energy’s President and Chief
Executive Officer, stated: “The second quarter of 2019 was
highlighted by double-digit fuel volume growth and continued
improvement in our overall financial position. Growth of our
renewable natural gas product, Redeem, also continues to be
encouraging, punctuated by the exciting announcement in the second
quarter that UPS agreed to buy 170 million gallons of Redeem over a
seven year period. This is one of the strongest endorsements yet of
the cleanest, most affordable and available alternative fuel
solution by one of the world’s largest logistics companies. These
new Redeem gallons are already flowing to UPS stations around the
country to operate their heavy-duty fleets and will play a role in
helping one of the most aggressively sustainable companies meet yet
another environmental goal.”
The Company delivered 99.6 million gallons in the second quarter
of 2019, an 11.4% increase from 89.4 million in the second quarter
of 2018. For the six months ended June 30, 2019, the Company
delivered 194.8 million gallons, an 11.6% increase from 174.5
million in the six months ended June 30, 2018. These increases were
due to growth in CNG and LNG volumes principally from increased
sales of Redeem.
The Company’s revenue for the second quarter of 2019 was $72.3
million, including an unrealized gain of $0.6 million on commodity
swap and customer fueling contracts that support the Company’s Zero
Now truck financing program, compared to $70.5 million of revenue
in the same period last year, which included $1.4 million of U.S.
federal excise tax credits for alternative fuels (“AFTC”). The AFTC
applied to vehicle fuel sales made from January 1, 2017 through
December 31, 2017 and expired effective January 1, 2018. Excluding
the unrealized gain on commodity swaps of $0.6 million in 2019 and
the AFTC of $1.4 million in 2018, revenue increased 3.8% for the
second quarter of 2019 compared to the prior year period, which was
driven by a 5.0% increase in volume-related revenue. Station
construction revenue was $5.9 million for the second quarter of
2019 compared to $5.8 million in the 2018 period.
The Company’s revenue for the six months ended June 30, 2019 was
$150.0 million, including an unrealized loss of $4.4 million on
commodity swap and customer fueling contracts that support the
Company’s Zero Now truck financing program, compared to $172.9
million of revenue in the same period last year, which included
$26.9 million of AFTC. Excluding the unrealized loss on commodity
swap and customer fueling contracts of $4.4 million in 2019 and the
AFTC of $26.9 million in 2018, revenue increased 5.8% for the first
half of 2019 compared to the prior year period, which was driven by
an 11.7% increase in volume-related revenue, reflecting higher
volumes and a continued strong RNG market. Station construction
revenue was $9.1 million for the six months ended June 30, 2019
compared to $11.6 million in the 2018 period. Also, 2018 included
$4.4 million in revenue from the sale of used natural gas trucks
acquired in 2017, which did not recur in 2019.
On a GAAP (as defined below) basis, net income (loss)
attributable to Clean Energy for the second quarter of 2019 was
$(5.4) million or $(0.03) per share, compared to $(12.0) million,
or $(0.07) per share, for the second quarter of 2018.
On a GAAP basis, net income (loss) attributable to Clean Energy
for the six months ended June 30, 2019 was $(16.3) million or
$(0.08) per share, compared to $0.2 million, or $0.00 per share,
for the six months ended June 30, 2018. The six months ended June
30, 2019 was negatively affected by $4.4 million in unrealized
losses from changes in fair value of derivative instruments whereas
2018 was positively affected by AFTC revenue of $26.9 million.
Non-GAAP income (loss) per share and Adjusted EBITDA (each as
defined below) for the second quarter of 2019 was $(0.02) and $8.9
million, respectively. Non-GAAP income per share and Adjusted
EBITDA for the second quarter of 2018 was $(0.06) and $7.4 million,
respectively.
Non-GAAP income (loss) per share and Adjusted EBITDA for the six
months ended June 30, 2019 was $(0.04) and $20.1 million,
respectively. Non-GAAP income per share and Adjusted EBITDA for the
six months ended June 30, 2018 was $0.03 and $39.7 million,
respectively, which included the AFTC revenue.
Non-GAAP income (loss) per share and Adjusted EBITDA are
described below and reconciled to GAAP net income (loss) per share
attributable to Clean Energy and GAAP net income (loss) per share
attributable to Clean Energy, respectively.
Non-GAAP Financial Measures
To supplement the Company’s unaudited condensed consolidated
financial statements presented in accordance with accounting
principles generally accepted in the United States of America
(“GAAP”), the Company uses non-GAAP financial measures that it
calls non-GAAP income (loss) per share (“non-GAAP income (loss) per
share”) and adjusted EBITDA (“Adjusted EBITDA”). Management
presents non-GAAP income (loss) per share and Adjusted EBITDA
because it believes these measures provide meaningful supplemental
information about the Company’s performance for the following
reasons: (1) these measures allow for greater transparency with
respect to key metrics used by management to assess the Company’s
operating performance and making financial and operational
decisions; (2) these measures exclude the effect of items that
management believes are not directly attributable to the Company’s
core operating performance and may obscure trends in the business;
and (3) these measures are used by institutional investors and the
analyst community to help analyze the Company’s business. In future
quarters, the Company may make adjustments for other expenditures,
charges or gains to present non-GAAP financial measures that the
Company’s management believes are indicative of the Company’s core
operating performance.
Non-GAAP financial measures are limited as an analytical tool
and should not be considered in isolation from, or as a substitute
for, the Company’s GAAP results. The Company expects to continue
reporting non-GAAP financial measures, adjusting for the items
described below (and/or other items that may arise in the future as
the Company’s management deems appropriate), and the Company
expects to continue to incur expenses, charges or gains similar to
the non-GAAP adjustments described below. Accordingly, unless
expressly stated otherwise, the exclusion of these and other
similar items in the presentation of non-GAAP financial measures
should not be construed as an inference that these costs are
unusual, infrequent or non-recurring. Non-GAAP income (loss) per
share and Adjusted EBITDA are not recognized terms under GAAP and
do not purport to be an alternative to GAAP income (loss), GAAP
income (loss) per share or any other GAAP measure as an indicator
of operating performance. Moreover, because not all companies use
identical measures and calculations, the Company’s presentation of
non-GAAP income (loss) per share and Adjusted EBITDA may not be
comparable to other similarly titled measures used by other
companies.
Non-GAAP Income (Loss) Per Share
Non-GAAP income (loss) per share, which the Company presents as
a non-GAAP measure of its performance, is defined as net income
(loss) attributable to Clean Energy Fuels Corp., plus stock-based
compensation expense, plus (minus) loss (income) from equity method
investments, and plus (minus) any loss (gain) from changes in the
fair value of derivative instruments, the total of which is divided
by the Company’s weighted-average shares outstanding on a diluted
basis. The Company’s management believes excluding non-cash
expenses related to stock-based compensation provides useful
information to investors regarding the Company’s performance
because of the varying available valuation methodologies, the
volatility of the expense (which depends on market forces outside
of management’s control), the subjectivity of the assumptions and
the variety of award types that a company can use, which may
obscure trends in a company’s core operating performance.
Similarly, we believe excluding the non-cash results from equity
method investments is useful to investors because these charges are
not part of or representative of the core operations of the
Company. In addition, the Company’s management believes excluding
the non-cash loss (gain) from changes in the fair value of
derivative instruments is useful to investors because the valuation
of the derivative instruments is based on a number of subjective
assumptions, the amount of the loss or gain is derived from market
forces outside of management’s control, and the exclusion of these
amounts enables investors to compare the Company’s performance with
other companies that do not use, or use different forms of,
derivative instruments.
The table below shows GAAP and non-GAAP income (loss) per share
and also reconciles GAAP net income (loss) attributable to Clean
Energy Fuels Corp. to an adjusted net income (loss) figure used in
the calculation of non-GAAP income (loss) per share:
Three Months Ended June
30,
Six Months Ended June
30,
(in thousands, except share and
per-share amounts)
2018
2019
2018
2019
Net Income (Loss) Attributable to Clean
Energy Fuels Corp.
$
(11,975
)
$
(5,383
)
$
247
$
(16,329
)
Stock-Based Compensation
1,208
918
3,106
2,164
Loss from Equity Method Investments
729
33
2,197
500
Loss (Gain) from Change in Fair Value of
Derivative Instruments
(70
)
(582
)
(92
)
5,992
Adjusted (Non-GAAP) Net Income (Loss)
$
(10,108
)
$
(5,014
)
$
5,458
$
(7,673
)
Diluted Weighted-Average Common Shares
Outstanding
162,613,316
204,653,723
161,682,245
204,426,459
GAAP Income (Loss) Per Share
$
(0.07
)
$
(0.03
)
$
0.00
$
(0.08
)
Non-GAAP Income (Loss) Per
Share
$
(0.06
)
$
(0.02
)
$
0.03
$
(0.04
)
Adjusted EBITDA
Adjusted EBITDA, which the Company presents as a non-GAAP
measure of its performance, is defined as net income (loss)
attributable to Clean Energy Fuels Corp., plus (minus) income tax
expense (benefit), plus interest expense, minus interest income,
plus depreciation and amortization expense, plus stock-based
compensation expense, plus (minus) loss (income) from equity method
investments, and plus (minus) any loss (gain) from changes in the
fair value of derivative instruments. The Company’s management
believes Adjusted EBITDA provides useful information to investors
regarding the Company’s performance for the same reasons discussed
above with respect to non-GAAP income (loss) per share. In
addition, management internally uses Adjusted EBITDA to determine
elements of executive and employee compensation.
The table below shows Adjusted EBITDA and also reconciles this
figure to GAAP net income (loss) attributable to Clean Energy Fuels
Corp.:
Three Months Ended June
30,
Six Months Ended June
30,
(in thousands)
2018
2019
2018
2019
Net Income (Loss) Attributable to Clean
Energy Fuels Corp.
$
(11,975
)
$
(5,383
)
$
247
$
(16,329
)
Income Tax Expense
89
66
177
126
Interest Expense
4,527
1,842
9,030
3,733
Interest Income
(489
)
(567
)
(1,064
)
(1,147
)
Depreciation and Amortization
13,332
12,605
26,133
25,084
Stock-Based Compensation
1,208
918
3,106
2,164
Loss from Equity Method Investments
729
33
2,197
500
Loss (Gain) from Change in Fair Value of
Derivative Instruments
(70
)
(582
)
(92
)
5,992
Adjusted EBITDA
$
7,351
$
8,932
$
39,734
$
20,123
Definition of “Gallons Delivered”
The Company defines “gallons delivered” as its gallons of
renewable natural gas (“RNG”), compressed natural gas (“CNG”) and
liquefied natural gas (“LNG”), along with its gallons associated
with providing operations and maintenance services, in each case
delivered to its customers in the applicable period, plus the
Company’s proportionate share of gallons delivered by joint
ventures in the applicable period.
The table below shows gallons delivered for the three and six
months ended June 30, 2018 and 2019:
Three Months Ended June
30,
Six Months Ended June
30,
Gallons Delivered (in millions)
2018
2019
2018
2019
CNG
73.8
83.8
144.6
162.3
LNG
15.6
15.8
29.9
32.5
Total
89.4
99.6
174.5
194.8
Sources of Revenue
The following table represents our sources of revenue for the
three and six months ended June 30, 2018 and 2019:
Three Months Ended June
30,
Six Months Ended June
30,
Revenue (in millions)
2018
2019
2018
2019
Volume-Related (1)
$
62.6
$
66.3
$
130.0
$
140.8
Station Construction Sales
5.8
5.9
11.6
9.1
AFTC
1.4
—
26.9
—
Other
0.7
0.1
4.4
0.1
Total Revenue
$
70.5
$
72.3
$
172.9
$
150.0
(1) For the three and six months ended June 30, 2019,
volume-related revenue includes an unrealized gain (loss) from the
change in fair value of commodity swap contracts of $0.6 million
and $(4.4) million.
Today’s Conference Call
The Company will host an investor conference call today at 4:30
p.m. Eastern time (1:30 p.m. Pacific). Investors interested in
participating in the live call can dial 1.877.407.4018 from the
U.S. and international callers can dial 1.201.689.8471. A telephone
replay will be available approximately two hours after the call
concludes through Sunday, September 8, 2019, by dialing
1.844.512.2921 from the U.S., or 1.412.317.6671 from international
locations, and entering Replay Pin Number 13692558. There also will
be a simultaneous live webcast available on the Investor Relations
section of the Company’s web site at www.cleanenergyfuels.com,
which will be available for replay for 30 days.
About Clean Energy Fuels
Clean Energy Fuels Corp. is the leading provider of natural gas
fuel for transportation in North America. We build and operate CNG
and LNG vehicle fueling stations, manufacture CNG and LNG equipment
and technologies, and deliver more CNG and LNG vehicle fuel than
any other company in the United States. Clean Energy also sells
Redeem™ RNG fuel and believes it is the cleanest transportation
fuel commercially available, reducing greenhouse gas emissions by
up to 70%. For more information, visit
www.cleanenergyfuels.com.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, including statements about, among other things, the
Company’s expectations regarding its 2019 results; the Company’s
ability to convert heavy -duty truck fleets with whom it is in
discussions into participants in the Company’s Zero Now truck
financing program; the success of the Zero Now program generally
and its effect, if any, on the U.S. natural gas trucking market and
the Company’s performance, financial condition and ability to
execute its strategic initiatives; the state of the natural gas
vehicle fuels market, including the level of adoption of natural
gas vehicle fuels generally, and specifically in the trucking
sector, and with respect to renewable natural gas; and the
Company’s supply agreement with BP and its effect, if any, on the
Company’s Redeem renewable natural gas business.
Forward-looking are statements other than historical facts and
relate to future events or circumstances or the Company’s future
performance, and they are based on the Company’s current
assumptions, expectations and beliefs concerning future
developments and their potential effect on the Company and its
business. As a result, actual results, performance or achievements
and the timing of events could differ materially from those
anticipated in or implied by these forward-looking statements as a
result of many factors including, among others: the willingness of
fleets and other consumers to adopt natural gas as a vehicle fuel,
and the rate and level of any such adoption; future supply, demand,
use and prices of crude oil, gasoline, diesel, natural gas, and
other vehicle fuels, including overall levels of and volatility in
these factors; natural gas vehicle and engine cost, fuel usage,
availability, quality, safety, convenience, design and performance,
as well as operator perception with respect to these factors, in
general and in the Company’s key customer markets, including
heavy-duty trucking; the Company’s ability to execute its Zero Now
truck financing program, a key strategic initiative related to the
market for natural gas heavy-duty trucks and the effect of this
initiative on the Company’s business, prospects, performance and
liquidity; the Company’s ability to capture a substantial share of
the market for alternative vehicle fuels and vehicle fuels
generally and otherwise compete successfully in these markets,
including in the event of improvements in or perceived advantages
of non-natural gas vehicle fuels or engines powered by these fuels
or other competitive developments; the availability of
environmental, tax and other government regulations, programs and
incentives that promote natural gas, such as AFTC, or other
alternatives as a vehicle fuel, including long-standing support for
gasoline- and diesel-powered vehicles and growing support for
electric and hydrogen-powered vehicles that could result in
programs or incentives that favor these or other vehicles or
vehicle fuels over natural gas; future availability of capital,
which may include equity or debt financing, in the amounts and at
the times needed to fund the growth of the Company’s business,
repayment of its debt obligations (whether at or before their due
dates) or other expenditures, as well as the terms and other
effects of any such capital-raising transaction; the effect of, or
potential for changes to federal, state or local greenhouse gas
emissions regulations or other environmental regulations applicable
to natural gas production, transportation or use; the Company’s
ability to manage and grow its RNG business, in particular after
the BP Transaction, including its ability to continue to receive
revenue from sales of tradable credits the Company generates by
selling conventional and renewable natural gas as vehicle fuel and
the effect of any increase in competition for RNG supply; the
Company’s ability to accurately predict natural gas vehicle fuel
demand in the geographic and customer markets in which it operates
and effectively calibrate its strategies, timing and levels of
investments to be consistent with this demand; the Company’s
ability to recognize the anticipated benefits of its CNG and LNG
station network; construction, permitting and other factors that
could cause delays or other problems at station construction
projects; the Company’s compliance with all applicable government
regulations; the Company’s ability to execute and realize the
intended benefits of any mergers, acquisitions, divestitures,
investments or other strategic measures, transactions or
relationships; and general political, regulatory, economic and
market conditions.
The forward-looking statements made in this press release speak
only as of the date of this press release and the Company
undertakes no obligation to update publicly such forward-looking
statements to reflect subsequent events or circumstances, except as
otherwise required by law. The Company’s periodic reports filed
with the Securities and Exchange Commission (www.sec.gov),
including its Quarterly Report on Form 10-Q filed on August 8,
2019, contain additional information about these and other risk
factors that may cause actual results to differ materially from the
forward-looking statements contained in this press release.
Clean Energy Fuels Corp. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(In thousands, except share
and per share data, Unaudited)
December 31, 2018
June 30, 2019
Assets
Current assets:
Cash, cash equivalents and current portion
of restricted cash
$
30,624
$
41,666
Short-term investments
65,646
66,584
Accounts receivable, net of allowance for
doubtful accounts of $1,919 and $2,074 as of December 31, 2018 and
June 30, 2019, respectively
68,865
60,567
Other receivables
15,544
9,408
Derivative assets, related party
1,508
655
Inventory
34,975
33,870
Prepaid expenses and other current
assets
8,444
9,043
Total current assets
225,606
221,793
Operating lease right-of-use assets
—
24,490
Land, property and equipment, net
350,568
328,630
Long-term portion of restricted cash
4,000
4,848
Notes receivable and other long-term
assets, net
17,470
17,968
Long-term portion of derivative assets,
related party
8,824
5,041
Investments in other entities
26,079
26,072
Goodwill
64,328
64,328
Intangible assets, net
2,207
1,704
Total assets
$
699,082
$
694,874
Liabilities and Stockholders’
Equity
Current liabilities:
Current portion of debt
$
4,712
$
55,562
Current portion of finance lease
obligations
693
654
Current portion of operating lease
obligations
—
3,570
Accounts payable
19,024
16,462
Accrued liabilities
48,469
39,763
Deferred revenue
7,361
7,438
Total current liabilities
80,259
123,449
Long-term portion of debt
75,003
24,912
Long-term portion of finance lease
obligations
3,776
3,236
Long-term portion of operating lease
obligations
—
22,245
Other long-term liabilities
15,035
12,901
Total liabilities
174,073
186,743
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.0001 par value.
Authorized 1,000,000 shares; issued and outstanding no shares
—
—
Common stock, $0.0001 par value.
Authorized 304,000,000 shares as of December 31, 2018 and June 30,
2019, respectively; issued and outstanding 203,599,892 shares and
204,655,146 shares as of December 31, 2018 and June 30, 2019,
respectively
20
20
Additional paid-in capital
1,198,769
1,201,340
Accumulated deficit
(688,653
)
(704,982
)
Accumulated other comprehensive loss
(2,138
)
(1,440
)
Total Clean Energy Fuels Corp.
stockholders’ equity
507,998
494,938
Noncontrolling interest in subsidiary
17,011
13,193
Total stockholders’ equity
525,009
508,131
Total liabilities and stockholders’
equity
$
699,082
$
694,874
Clean Energy Fuels Corp. and
Subsidiaries
Condensed Consolidated
Statements of Operations
(In thousands, except share
and per share data, Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2018
2019
2018
2019
Revenue:
Product revenue
$
61,120
$
59,691
$
153,371
$
128,139
Service revenue
9,347
12,627
19,499
21,877
Total revenue
70,467
72,318
172,870
150,016
Operating expenses:
Cost of sales (exclusive of depreciation
and amortization shown separately below):
Product cost of sales
41,396
40,121
91,595
94,551
Service cost of sales
4,255
7,489
8,852
11,887
Change in fair value of derivative
warrants
(70
)
(17
)
(92
)
1,597
Selling, general and administrative
19,938
17,933
38,797
36,368
Depreciation and amortization
13,332
12,605
26,133
25,084
Total operating expenses
78,851
78,131
165,285
169,487
Operating income (loss)
(8,384
)
(5,813
)
7,585
(19,471
)
Interest expense
(4,527
)
(1,842
)
(9,030
)
(3,733
)
Interest income
489
567
1,064
1,147
Other income (expense), net
79
93
67
2,764
Loss from equity method investments
(729
)
(33
)
(2,197
)
(500
)
Income (loss) before income taxes
(13,072
)
(7,028
)
(2,511
)
(19,793
)
Income tax expense
(89
)
(66
)
(177
)
(126
)
Net income (loss)
(13,161
)
(7,094
)
(2,688
)
(19,919
)
Loss attributable to noncontrolling
interest
1,186
1,711
2,935
3,590
Net income (loss) attributable to Clean
Energy Fuels Corp.
$
(11,975
)
$
(5,383
)
$
247
$
(16,329
)
Income (loss) per share:
Basic
$
(0.07
)
$
(0.03
)
$
0.00
$
(0.08
)
Diluted
$
(0.07
)
$
(0.03
)
$
0.00
$
(0.08
)
Weighted-average common shares
outstanding:
Basic
162,613,316
204,653,723
157,432,786
204,426,459
Diluted
162,613,316
204,653,723
161,682,245
204,426,459
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190808005822/en/
Investor Contact: investors@cleanenergyfuels.com
News Media Contact: Raleigh Gerber Manager of Corporate
Communications 949.437.1397
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